Management and directors need to improve their understanding of local business practices and cultures when dealing with emerging markets issuers, say lawyers with Norton Rose Canada. In a session on emerging markets issuers, Janet Howard, Robert Mason, and Steve Tanai said that is one of the recommendations coming out of the Ontario Securities Commissions (OSC) review of emerging markets issuers. They said the OSC conducted a study of emerging markets issuers, defined as operations where management and the principal activities are largely outside Canada (especially Asia, Africa, South America, and Eastern Europe). Notable concerns were raised about areas such as how local management and Canadian oversight are separated when core assets are located in an emerging market far from those bound by Canadian corporate governance standards. It also wanted to determine if the level of professional skepticism and rigour of the gatekeepers ‒ auditors, underwriters, and stock exchanges ‒ are sufficient.
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